According to an article in the Star-Telegram, unemployed workers may be worse off now than they were the last time the unemployment rate topped 10 percent in 1982.
The article said:
“Americans have more than triple the debt they had in 1982, and less than half the savings. They spend 10 weeks longer off the job. And a bigger share of them have no health insurance, leaving them one medical emergency away from financial ruin.”
This is exactly what many analysts have noted about today’s unemployed workers. They are more financially vulnerable to job losses than their predecessors in 1982. And some would even venture to suggest that unemployed workers are worse off than the unemployed during the Depression. Today there is a domino effect taking place where employers opt for job losses, consumers cut back on spending and the banks feel the crunch as both individuals and businesses find it difficult to pay their debts. With the rising cost of health insurance, many unemployed workers are finding themselves strapped with medical debt because they can’t afford to make COBRA payments which can cost nearly $1000 a month for a family of three or four. Medical debt coupled with other financial blows can cause many unemployed Americans to end up facing foreclosure, wage garnishments and other aggressive creditor tactics. Fortunately, today’s bankruptcy code offers Americans an opportunity to discharge most of their unsecured debt and win reasonable payment terms for secured debt such as a car payment or mortgage that has become delinquent.